In Brief:
- Supreme Court rulings allow NCAA athletes to receive compensation and endorsements for their likeness.
- Revenue sharing now lets Division I schools distribute up to 22% of Power 5 revenue to players.
- Conference realignment, expanded playoffs, and unrestricted transfers have altered traditional college football rivalries.
- Critics warn reforms risk turning college football into a professional league focused on money over school pride.
Everyone who follows college football saw huge changes in the game this year. There is now revenue sharing between the colleges and players, a realignment of conferences, expanded playoffs and no restrictions on players transferring. But most college football fans may not realize these changes arose due to a Supreme Court decision eliminating the restraints on a college player’s ability to make money. Permitting student athletes to receive compensation for their contributions is warranted; however, these changes have diminished the sport’s traditional appeal. Instead of representing their school, college athletes have become free agents, willing to play for the highest bidder.
In 2020, the Supreme Court ruled in National Collegiate Athletic Association v. Alston that the NCAA could not restrict a player’s ability to be paid for the use of his likeness or endorsements and struck down limits on the number of scholarships awarded to players. The Supreme Court expressly held that the NCAA is subject to antitrust limitations and suggested that the limitation on a school paying a player would be illegal also.
Although a few professional sports leagues, like Major League Baseball, are exempt from the antitrust laws, as of now college football is not one. To be expected, lawsuits challenged any restrictions on a player’s ability to be paid by the school they attend, and these lawsuits were consolidated as a class action. This past year, a settlement of the class action was approved.
Pursuant to the settlement, which colleges could opt out of and continue with litigation, NCAA Division I member schools can share up to 22% of the revenue of the Power 5 schools —SEC , Big Ten ACC, Big 12 and PAC 12—including media rights, ticket sales and sponsorships. This cap means that any one of the over 350 Division I schools can share up to $20.5 million with its student athletes.
The settlement has been criticized as merely exchanging one cap—zero—with another cap. This limit on revenue sharing, critics claim, will actually constrain an athlete’s earning capacity and is likely to engender more litigation. At the other extreme, legislation introduced in Congress, called the SCORE Act, would exempt college football from the antitrust laws.
There is a compelling argument to allow college football players to earn money for playing. College football raises millions of dollars for the schools, and the players are at risk of injury, which could prevent them from playing in the NFL. But the NCAA’s actions have made college football just another professional league. Fewer conferences now stretch coast to coast, players can transfer without restrictions, and colleges now compete as to how much money they can pay.
Revenue sharing seems like a workable solution, but the other reforms—including removing restrictions on transferring—such as losing a year of eligibility, did not have to be pushed to the sideline. College football’s popularity was based on student and alumni pride in their schools and regional rivalries. While complete exemption from the antitrust laws is not necessary, some leeway must be given to the NCAA to preserve players’ excitement for playing for their school’s pride and not just for money. That is a terrible thing to lose.
E. Christopher Murray is a partner at Rivkin Radler’s Commercial Litigation and Real Estate practice groups. The views expressed here are his own and do not necessarily represent the views of the firm.
Opinion
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